Charlie Chanaratsopon is a young man in a very great hurry. “I hate downtime!” exclaims the 35-year-old Thai-American, chopping the air for emphasis. With his slicked-back hair and sleeves rolled up to the elbows, he’s always ready to get down to business–even as he weaves frantically in and out of Houston traffic in his black Mercedes S550, eager to show a visitor one of his stores. “I’d probably be the worst lawyer, worst doctor, the worst engineer on the planet because of my ADD-ness,” says Chanaratsopon (cha-na-ROT-such-pon).
No examples of botched cases, mangled surgeries or shoddy construction in his world. But there’s an element of reckless endangerment in Chanaratsopon’s rush to build a retail chain of accessories. In less than a decade the young founder and CEO of Charming Charlie have built a $400 million-plus (sales) mini-empire of watches, necklaces, scarves, and handbags–284 stores in 40 states that FORBES values at $1 billion-plus. With an estimated net worth of $500 million, he’s careening toward billionaire status before his 40th birthday.
Since launching his first store in Houston nine years ago, Chanaratsopon hasn’t slowed down a white. He’s now opening five stores a month, mimicking the model of fast-fashion giants Zara and H&M by selling attractive but cheaper versions of trendy items, sourced from Asia. Examples: $15 scarves, $9 sunglasses and $7 to $15 iPhone cases. Customers spend, on average, $30.
Is he making money? Chanaratsopon insists that all but one of his existing locations is profitable. The company’s Ebitda is an estimated 15% or so–better than most apparel chains but far below luxury retailers like Coach COH -1.76% and Michael Kors. Chanaratsopon refuses to comment on a key index–same-store sales growth–though it’s probably safe to peg it at 10% (Francesca’s, a clothing and accessories boutique with 360 outlets, does 10% to 15%). One former Charming Charlie buyer claims on her LinkedIn LNKD +% page that her division, apparel and accessories, expanded 26% across same stores in 2012.
Chanaratsopon says he’s in a race to capitalize on a burgeoning trend. Accessories are a $9.2-billion-a-year business in the U.S. and expanding swiftly. As a category, paired with beauty and footwear retailers, it grew six times as fast as other mall-based apparel stores from 2007 to 2012, reports Credit Suisse. “We’ve spent years brute-forcing things across the finish line,” says Chanaratsopon.
His drive runs deeper than business, supercharged as it is a familiar immigrant success story. His maternal grandfather worked at a gas station in Houston to put his two daughters through college. As the first generation born in the U.S., Chanaratsopon always felt the heat to keep pushing. Perhaps a frightening childhood episode played a part, too. Burglars broke into his house at 2 a.m., tied up his family and forced his father to give up all their valuables. “They put me on the floor and started kicking me,” he recalls. “They took the revolver out, shoved it in my throat, clicked it back. I’m 13, and all I remember thinking is, ‘Well, I think I had a great 13 years.’ “
His parents, who immigrated in 1974, had founded Silver Express, a sterling silver jewelry outfit that sourced production from Thailand and sold on consignment to the likes of J.C. Penney, Nordstrom JWN -3.11%, Target TGT -1.46% and Wal-Mart. Chanaratsopon grew up with the business, watching his parents work 18-hour days, overhearing dinner-table discussions of employee issues and traveling with them on sales calls and sourcing visits.
Some of that business education surely stuck, since Chanaratsopon ended up in the elementary school principal’s office after charging first-grade classmates $1 a day to rent his Nintendo games. Profits fueled more game purchases and, hence, more rentals. Today, he says, “I’m still buying and selling–that’s what I love.”
There were detours. After graduating from Loyola Marymount in Los Angeles with a degree in finance, he became a real estate analyst at Sanwa Bank, then came back to Houston to help his dad find a new headquarters, persuading him to build rather than lease. Chanaratsopon supervised construction of an office building as well as an adjacent strip mall, which he quickly filled with tenants. That venture was so successful he started financing construction of other shopping centers in Houston’s suburbs, building seven in two and a half years. “It wasn’t being smart, it was kind of luck at the time,” he muses. “The real estate market was so hot, and they were valuing it so high, whatever you built you could make so much refinancing and selling it.”
But Chanaratsopon couldn’t sit still. He dreamed of building 100 such malls and making more money by owning the store that anchored them all. But what kind? Apparel had too many players. Harwin Avenue, Houston’s stretch of discount stores offering cheap imports in warehouse settings, offered inspiration. With leftover consignment returns from Silver Express as the merchandising backbone, the first Charming Charlie opened in October 2004.
It nearly died after the first month of desultory traffic. On a whim Chanaratsopon decided not to pull the plug and re-lease the space but to stay open another couple of weeks. Thanks to dumb luck, or a direct-mail drop, women started queuing up outside the doors before Charming Charlie opened each morning. “It became the ‘in’ place for suburban moms’ day out,” recalls COO Steve Lovell, who joined the company after the third store. “Word spread like crazy. My wife heard about it from her friend before it ever opened near us.”
Charlie Chanaratsopon didn’t need much encouragement to start fast-tracking. “Own the store, own the complex–that was the idea,” he says. “That kind of turned when I realized you couldn’t physically
on it, didn’t complete the thought,” he says. Take two, launched in October, is clean if the unexciting website that isn’t yet mining a potentially rich vein of customer data.
If there are speed traps ahead, Chanaratsopon seems determined to ignore them. Says Bill Moreland, the new vice president of real estate, “It’s 100 miles per hour all the time around here.”